Will the sun rise again for cryptocurrencies? With trillions lost in last week's crash, analysts see a grim picture ahead, but for one digital token, a top Wall Street investment bank predicts an amazing recovery.
In a leaked document reported obtained by Forbes, Goldman Sachs gave Ethereum a rosy forecast of a "high chance" of surpassing Bitcoin as the "dominant store of value."
The investment bank further described Ethereum as the "Amazon of information."
This comes after the Bitcoin value dropped 50 percent from its all-time high of $65,000 in April, and Ethereum likewise tumbled to more than half its value last Wednesday after reaching its own record high of $4,000 in early May to a head-scratching intraday low of $1,895.
Ethereum Price Prediction: Value Set to Soar Due to 'Thriving Ecosystem'
Goldman Sachs analysts pointed to a thriving Ethereum ecosystem that "supports smart contracts and provides a way to create new applications on its platform."
Read also: Ethereum Price Prediction: Bearish Sentiment, China 'Crackdown' Could Pull Price Down to $2,000
They added other factors that could shore up Ethereum prices, including the fact that most decentralized finance (DeFi) apps are being developed on the Ethereum network, and that most non-fungible tokens (NFTs) are being purchased using Ether, as The Ascent report noted.
"The greater number of transactions in Ether versus Bitcoin reflects this dominance," the analysts noted.
DeFi, leverages on cryptocurrency technology to create an alternative to such traditional financial instruments as loans and interest, Forbes noted. And this was deemed to supplant brick and mortar institutions with blockchain protocols. A surge in the popularity of DeFi apps has helped Ethereum skyrocket immensely.
NFTs, which are authenticated copies of digitized collectibles, including visual art, video, and music that have likewise been sold in millions of dollars, are mostly issued on the Ethereum blockchain, Forbes further stressed.
Ethereum Value Outpaces Bitcoin Over the Past Year
Over the past year, the Forbes report noted that Ethereum value has "outpaced" Bitcoin, with Ethereum accumulating 1,000 percent as against Bitcoin's 300 percent, even with Wednesday's crash accounted for.
What could even add fuel to Ethereum's forecasted surge is heightened activity over upcoming network upgrades.
The Ethereum 2.0 upgrade, which is named after the brightest star in the Aquila constellation in the northern hemisphere, "Altair" is scheduled to unveil in July or August, as per Coindesk.
Its separate 11th backward-compatible, system-wide hard-fork upgrade, meanwhile, is also set around that time, so users can expect maximum efficiency. This is seen to help the digital token cut its high-transaction costs, lifting ETH price to unprecedented heights.
Ethereum, Not a Mere Value Token, Says Expert
Ethereum is not a mere value token like Bitcoin, says MyEtherWallet CEO Kosala Hemachandra in the Forbes report. He emphasized that Ethereum "actually fuels all use cases (such as DeFi and NFTs) built on top of the ETH blockchain."
Hemachandra said amidst the crash last Wednesday, "long-term development is unaffected and Ethereum is well on its way to market dominance over Bitcoin."
